The average 30-year mortgage rate has dropped by 89 basis points from a high of 7.04% in 2025. Mortgage interest rates are determined by various factors, hinting at future trends. Forecasts may be best derived from trends in 10-year Treasury note rates.

Deloitte predicts the 10-year Treasury yield to remain above 4.1% through 2030, while Goldman Sachs expects it to rise to 4.5% by 2035. The CBO forecasts a yield of 3.9% by the end of 2026, dropping to 3.8% by 2030.

The spread between 10-year Treasury and 30-year fixed mortgage rates is crucial. Recent years have shown a spread of around 2.5 percentage points, impacting mortgage rates. Using these estimates, a five-year mortgage rate forecast can be formulated.

Long-range estimates based on historical norms suggest mortgage rates are not expected to drop significantly in the next five years. A recession or unexpected economic event could alter this outlook. Considerations for adjustable-rate mortgages and initial fixed-rate periods are important for budget planning.

Read more at Yahoo Finance: A data-driven forecast through 2030